The Estée Lauder Companies Inc. provided earnings guidance for the second quarter and fiscal year 2023. For the quarter, the company's net sales are forecasted to decrease between 19% and 17% versus the prior-year period. This range includes the negative impacts from tighter inventory management in travel retail in response to the decreased traffic driven by COVID-related restrictions, foreign currency translation of 7% as well as an additional unfavorable impact from certain foreign currency transactions in key international travel retail locations of 2%, and the termination of the Company's license agreements for the Donna Karan New York, DKNY, Michael Kors, Tommy Hilfiger and Ermenegildo Zegna product lines effective June 30, 2022. Organic net sales, which excludes returns associated with restructuring and other activities; non-comparable impacts from acquisitions, divestitures and brand closures; as well as the impact of foreign currency translation, are forecasted to decrease between 11% and 9%. This includes the negative impact related to foreign currency transactions, noted above. Despite the forecasted decrease in net sales, the Company plans to continue to make strategic investments to drive long-term growth, including investments in advertising, innovation, its innovation center in Shanghai and its manufacturing facility in Japan. These investments will have a greater impact to diluted net earnings per common share due to the expected decline in net sales. Reported diluted net earnings per common share are projected to be between $1.14 and $1.26. Excluding restructuring and other charges, diluted net earnings per common share are projected to be between $1.19 and $1.29.

For the year, the Company expects its first-half results to be negatively impacted by the ongoing challenges from the COVID-related restrictions affecting Asia travel retail, including tightening of retailer inventory, and mainland China. The Company also expects the tightening of inventory in the United States to negatively impact its first-half results. For the second half, the Company expects sequential improvement to its results and a gradual recovery as restrictions are lifted, travel resumes to Hainan and the tightening of inventory subsides. Reported net sales are forecasted to decrease between 8% and 6% versus the prior-year period. This range includes: Tighter inventory management in travel retail in response to the decreased traffic driven by COVID-related restrictions. A negative 6% due to foreign currency translation, as well as an additional 2% due to certain foreign currency transactions in key international travel retail locations. The negative impact of 1% from the termination of the Company's license agreements for the Donna Karan New York, DKNY, Michael Kors, Tommy Hilfiger and Ermenegildo Zegna product lines effective June 30, 2022. A negative impact of 1% related to returns associated with restructuring and other activities. Organic net sales, which excludes returns associated with restructuring and other activities; non-comparable impacts from acquisitions, divestitures and brand closures; as well as the impact of foreign currency translation, are forecasted to be flat to increase by 2%. This includes the negative impact related to foreign currency transactions, noted above. Despite the forecasted decrease in net sales, the Company plans to continue to make strategic investments to drive long-term growth, including investments in advertising, innovation, its innovation center in Shanghai and its manufacturing facility in Japan. These investments will have a greater impact to diluted net earnings per common share due to the expected decline in net sales. Reported diluted net earnings per common share are projected to be between $5.01 and $5.21. Excluding restructuring and other charges, diluted net earnings per common share are projected to be between $5.25 and $5.40.